Investing.com - Gold prices bounced higher in the wake of last week’s decline as increased tension between the U.S. and Iran sparked demand for the safe haven asset.
At 8:40 AM ET (12:40 GMT), gold futures for June delivery on the Comex division of the New York Mercantile Exchange gained $3.15 cents, or 0.3%, at $1,279.15 a troy ounce, bouncing back from a four-month low of $1,270.10 reached on April 18.
Gold fell more than 1% last week, its fourth straight weekly decline, as better-than-expected data out of China and a positive spike in German investor confidence increased risk appetite.
But geopolitical tension was on the rise Monday after reports surfaced that the U.S. planned to end waivers for its sanctions on Iranian oil.
U.S. stocks slipped as traders took risk off the table and rotated into the safe haven precious metal.
“Over the next few months, we believe increased volatility in the U.S. stock market may drive (gold) prices a bit lower as price rotates near all-time highs,” Chris Vermeulen, founder of AlgoTrades Algorithmic Trading Systems, said.
Although Vermeulen predicts that gold could fall below $1,275 before forming a bottom, “we believe the next upside price leg in gold will push prices above $1,400 initially, likely in May or June 2019.”
In other metals trading, silver futures was little changed at $14.963 a troy ounce by 8:44 AM ET (12:44 GMT).
Palladium futures advanced 0.9% to $1,410.90 an ounce, while sister metal platinum traded up 0.8% at $910.50.
In base metals, copper fell 0.9% to $2.895 a pound.